Web3 has been the subject of speculation for many years and speculation about what it will boost
Web3 has been the subject of speculation for many years now, and predictions about what will drive mass adoption are common, as are potential roadblocks to slow the integration process.
Some, like executives at Web3 Games, have predicted hype in the cryptocurrency market, and several upcoming blockchain games could be key to crowdsourcing.
According to a Feb. 22 survey report from leading management network Web3Auth, which received 3,378 responses from Web3 users, developers and decision-makers around the world, participants believe there are still many issues that need to be resolved before before mass adoption becomes a reality.
Speaking to Cointelegraph, Robert Hoogendoorn, head of content at blockchain analytics platform DabRadar, said he believes two obstacles in particular need to be overcome: “a simplified interface and user experience” and the increase in general consumer knowledge about cybersecurity.
“One has been greatly improved in recent years, while the other could use some work. Did you know that 60% of American consumers use the same password on multiple accounts? he said.
“This is the same audience you want to attract to Web3, and who will be surprised when MegaPepeBitcoinToken turns out to be a draw? This is just one of the major challenges that await us.
At the same time, Hoogendoorn says it’s not uncommon for “technological advancements” to come with employee onboarding challenges. He believes that the Web3 industry has made “significant progress” in this area.
“Getting established in Web3 is a challenge. Insiders praise the technology, but for the end user, it’s all about the experience.
“Only now have we reached a point where Web3-based financial services or video games are reaching a level of sophistication that can attract millions of people,” Hogendoorn added.
Web3Auth survey respondents say the biggest barrier preventing people from adopting Web3 is concerns about security and risks to people’s assets.
According to Hoogendoorn, the broader cryptocurrency industry has been referred to as the “Wild West” for a decade, “and it’s not something that appeals to the general public.” He believes this perception of weak cybersecurity is a barrier that prevents users from using Web3.
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Issues such as media coverage of FTX’s collapse and the subsequent trial of Sam Bankman Fried, where he was sentenced to 25 years in prison for fraud, have done little to contribute to this perception.
The collapse of other prominent cryptocurrency companies, such as Singapore-based $10 billion cryptocurrency hedge fund Three Arrows Capital, in 2022 has also contributed to the negativity that could deter investors. mainstream users to join Web3.
Rug pulling and hacking are also a thorn in Web3’s side. According to a research report published on February 29 by blockchain security company Immunefi, more than $200 million worth of cryptocurrencies have been lost due to hacks and 32 individual incidents so far in 2024.
Education and positive public relations can be the solution
Hogendoorn believes the negative perception of Web3 will need to change to drive mass adoption of the technology, and that will likely require “a lot of positive PR” from the industry.
Change is also needed for the general public, through better education on safety best practices.
“In general, people are known to be very bad at managing their account names and passwords because most of them don’t use two-factor authentication and a lot of “They use the same password all the time,” Hoogendoorn said.
“People value safety but don’t act responsibly. In Web2 this can cause problems, but in Web3 it can cause your funds to be instantly stolen. When this happens, it – once again – negatively impacts our industry.
Speaking to Cointelegraph, BNB Chain’s core development team said, “There are many obstacles that can act as blockers” when onboarding people to Web3. The most notable are lack of education and access to unfamiliar user experiences or lack of incentive mechanisms.
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“Widespread adoption of Web3 will likely be facilitated by several key factors, including ease of use, secure and reliable infrastructure, and education,” they said.
According to the team, Web3 can be difficult to navigate for newcomers to the field. So it’s important to “offer fun and engaging ways” to participate, such as meme campaigns offering incentives and rewards.
Overall, the BNB Chain core development team says strong infrastructure, user experience, and performance are key to onboarding more Web3 users.
“The path to mass adoption of Web3 will likely be gradual and multifaceted, involving innovative technology, user-friendly interfaces and education,” they said.
“The priority must remain improving the usability of current technology rather than relying solely on advances that help move from Web2 to Web3.”
Complex technology and uncertain regulations slow Web3 adoption
Joining Web3 is complex and difficult for non-technical users to understand, said Pavel Salas, chief growth officer at the Gear Foundation – the organization behind the Gear Protocol –.
Web3 applications are not always easy to use, which is a major barrier to adoption and can drive away new users, he told Cointelegraph.
“Let’s take the example of a game on a rope. First, users need to download a wallet and obtain the necessary tokens – this could be a game-specific token or a public protocol like Ethereum or Solana.
“After setup, they face constant requirements to pay for gas with every transaction. »
Sami Start, co-founder and CEO of developer onboarding toolkit Transak, told Cointelegraph that the transition from fiat currency to cryptocurrencies faces a critical bottleneck.
“Less than 10% of internet users worldwide own cryptocurrencies, reflecting significant barriers to entry,” he says.
According to a market size report from cryptocurrency exchange Crypto.com, the global number of cryptocurrency users increased by 34% in 2023, from 432 million to 580 million people. Online data platform Statista estimates that as of April 2024, there were 5.44 billion internet users worldwide.
Regulatory complexities and various integrations with existing financial systems also make the transition to Web3 intimidating for new users, Start says.
In May 2023, the European Council adopted the first comprehensive legal framework for the cryptocurrency sector.
However, other countries and jurisdictions have been slower to create a framework for cryptocurrencies, with some banning their use outright.
Start also believes that the Web3 space is fragmented with multiple blockchains and protocols, which could confuse users and limit potential network effects that drive adoption.
“As an industry, it is essential to streamline these processes, ensuring that converting fiat currencies to cryptocurrencies is as simple as any traditional online payment,” he said.
“By addressing these challenges, we can make the transformative potential of blockchain accessible to a wider audience and significantly increase adoption rates.”
Speaking to Cointelegraph, Ken Timsit, managing director of Web3 startup accelerator Kronos Labs, said that for most cryptocurrency users, setup first happens on a cryptocurrency exchange.
“It works very well at the moment because the major exchanges are regulated and implement KYC (know your customer) checks,” he says.
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KYC is a set of steps that cryptocurrency exchanges follow during setup to verify a customer’s identity and perform due diligence to understand financial activities and risks.
“We would all like to attract more casual users,” says Timsit, but he believes the question to be resolved is how to develop the technology; Specifically, it should be aimed at everyday users, not those with crypto experience.
“Many recent success stories, such as liquid recovery, standardized measurement protocols and memecoins, have been driven by a power user base,” he said.
